Succession - a difficult time for any family business

Family businesses, are a very specific type of business. Management or supervisory boards are, as much as 95% family members. However, the situation in this area is changing dynamically. Especially since future successors are not always willing or able to take full responsibility for the future of the company. External management is often a more effective solution. Despite the fact that family-owned companies, i.e. those with a certain working practice, are often exposed to a certain nepotism or ossified management that is not adapted to modern business models.

Greater professionalization in management, means a better chance of running the business safely and better prospects for the future. Because a big problem today is that it is very often the case that all knowledge of the company and its operation is possessed only by the owner. This greatly limits the ability of many employees to possibly "catch" opportunities that arise, which can only be seen with knowledge of the company's operations, more detailed, and not just a general outline of operations. Family business owners rarely choose to completely hand over management to outsiders. As research shows, only in 5 percent of cases no family member sits on the management or supervisory board. It should be remembered that the supervisory board has specific functions. Among its tasks we should specify: constant supervision of the company's activities, control of all areas of the company's operations. Its competencies include: evaluation of the management report on the company's activities and financial statements for the past financial year, as well as evaluation of the management board's proposals on the distribution of profit or coverage of losses. Remember: The key success factor for cooperation will be to realize the appropriate role.

Supervisory board vs. "family board"

The two terms sound similar, but mean very different things. However, they are often confused in family businesses. Currently, we are actually dealing with two types of supervisory boards. In the former, the board members are primarily family members, while in the latter, the members are outsiders. Seemingly, there is nothing wrong with either one or the other, but practice shows that family members usually do not have the necessary competence for optimal management.

It is worth considering further education in the aspect of crisis management, which is undoubtedly succession. In the case of taking over the helm of a company, by the younger generation, they take over the "full package" of lessons in the know how of how to run a company. Of course, an excellent number of these valuable lessons are actually...priceless, but there is usually also a field left where a new fresh perspective from a consultant, practicing in the latest solutions for business models also bears this honorable title: priceless knowledge.